A NICS check is not a good measure of firearm "sales". A NICS check is a background check provided by the Federal gov't to a licensed firearm dealer. A sale maybe be declined after the NICS check (or due to the check), or otherwise cancelled for financial reasons. A NICS check might also be completed once for a single transaction of multiple firearms.It is required for all retail purchases (such as from a store) and for state to state private sales. Actual sales data from manufacturers is a closely held secret for both political and business reasons. Therefore, estimating total firearms in possession by the American public is tricky business, as well as estimating new firearms deliveries into the market.
If we assume 1:1 ratio for NICS checks per new firearm sale then we have ~160M new firearms sold in the past 14years.
Even as a firearm supporter, that number amazes me. But I need to realize, these are not all new sales. Many of these will be resale, this is, a used firearm sold to a store, sold to a new owner. Or state to state private transactions. This would imply a <1 new firearm per NICS check.
On the other hand, 1 NICS check can be used to purchase several firearms at a time. This would imply a ratio of >1 firearm sold per NICS check.
Perhaps it does balance out near 1?
Even though I cannot know what ratio is the most acurate, I will proceed forward with NICS data as a rough proxy for firearms sales since it is the best data available.
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Repeating arms (a.k.a. revolvers, lever action, pump action etc), using modern smokeless cartridges have been sold since around 1865 and really took over the markets in the 1880's with advancing chemistry, materials, and manufacturing efficiency. Some of the most popular arms in use today fire cartridges developed in the 1910s to 1930s. Firearms rarely degrade to the point of scrap and have an extremely long shelf life. Therefore, the stock of privately owned arms have been increasing since the previous turn of the century. The private stock is currently estimated to be roughly in the 280M to 300M range.
So to get the 300M number, 160M arms have been sold in 14 years... and only 140M arms sold in 89years previous. If we assume that 1:1 ratio for NICS checks to factory new firearm sales, then we have a back side of an exponential growth curve. By curve fitting, I can get the exponential growth to match to a 314M estimate at January 2013.
If we take an upper bound and say there are 1.5 NEW firearms sold in each NICS check, this lines up an exponential growth curve of 440M arms total in the US.
If we take a lower bound and say there are 0.5 NEW firearms sold in each NICS check, this lines up an exponential growth curve of 160M arms total in the US.
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Sales have a regular pattern; sales are slowest in July, and builds to a peak in December, quickly falling off in January; with a small regular bounce in March. The climb in sales in the fall and peak in December is clearly Christmas season purchases doubled up with many important hunting seasons, as indicated by the precipitous fall in January. I'm not sure what the March bounce is... maybe turkey season?
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From the seasonal rhythm of sales, a few events can be seen. Fall of 99 had an usually good sales numbers with a 25% bump above normal in Dec 99. Most logically, this was due to the Y2K worries.
Fall 2001 also had a sales blip, this one centered around September and October, creating an early peak. Again, this is logically due to 9/11. December still sold more, at about typical rates. Much smaller impact than Y2K. Having an early double peak like this essentially increase volume by a 10-20% margin for the quarter.
Several years of regular pattern. 2006-2008 saw a slow trend upwards in sales.
Fall of 2008 saw another early season peak. Sales for both Nov & Dec exceed even the upward trend line, rising above normal by about 20% for December. Combined with an equal number of sales in November, that season posted record total volumes. The most logical cause is a combination of fear due to the financial meltdown and Obama's election.
The following years see a return to more normal rhythms again, but the trend upward continues to accelerate. Record volumes are broken again in December 2011 without any overt news event.
Fall of 2012 sees another early season spike in November, with the re-election of Obama and status quo in DC. This early season peak is inline with previous cases, where it matches the expected December volume a month early. Nov 2012 to Nov 2011 was already a YoY record increase of 31% (2.01/1.53); but in this case the Sandy Hook tragedy seems to have caused an additional reaction that completely outpaced every previous peak, by wide unquestionable margins. The NICS volume was 2.78M checks, a further 38% increase of the record number from the previous month (November). This combines to create an approximately 60-70% increase in quarterly volume above what is normally expected.
The fall 2012 sales volume spike is on top of an already accelerated trend of increased volume. This bears out the increased pricing that we have noted since 2006. Assuming we do not have another firearm ban (or God forbid a confiscation effort), I think we are sitting on a very large firearm bubble. I don't know where the top of the bubble is, but it feels very close to me. If I had extra EBRs to sell, I would be selling while the market it high.
